DC2023-10-0029 — Non-FIT-Eligible RE Technologies in the GEAP

Full title: Providing Specific Auction Policy and Guidelines for Non-FIT-Eligible Renewable Energy Technologies in the Green Energy Auction Program Issued: 12 December 2023 Issuing authority: DOE Secretary Raphael P.M. Lotilla Relation to DC2021-11-0036: Supplements — does not repeal — the GEAP Guidelines; fulfills the mandate of DC2021-11-0036 §6.1.3 Amended by: DC2024-03-0010; DC2024-09-0028 Governs: GEA-3 (auction: 11 February 2025; NOA: 10 June 2025) Public consultation: 14 July 2023 online consultation on draft (Annex C)

Flagged discrepancy (resolved in favor of the fuller record): the source summary’s amendments: frontmatter listed only DC2024-09-0028, omitting DC2024-03-0010. The knowledge page’s amendments: list included both, and the body of both files documents the DC2024-03-0010 amendment in detail (see below). The frontmatter above keeps both amendments, since the source summary’s shorter list appears to be an oversight rather than a substantive claim that DC2024-03-0010 does not amend this circular.

This circular governs the participation of Non-FIT-Eligible RE technologies — geothermal, impounding hydro, pumped-storage hydro, and other emerging technologies declared by the DOE — in the Green Energy Auction Program . It was mandated by §6.1.3 of DC2021-11-0036 , which explicitly excluded these technologies and required a separate policy.

What Changed from DC2021-11-0036

DC2023-10-0029 introduces four structural departures from the GEA-1/GEA-2 framework. These are not refinements — they represent a materially different auction architecture for non-FIT technologies.

1. ERC becomes the bid approver, not just the price-ceiling setter

Under DC2021-11-0036 , the ERC’s role was limited to setting the GEAR Price (ceiling) before each round. The DOE declared winners based on lowest bid.

Under DC2023-10-0029, the ERC actively evaluates and approves the winning bids. The process works as follows:

1. DOE notifies ERC of the upcoming round and submits recommended evaluation parameters and criteria
2. ERC issues its own approved parameters and criteria within 90 days [DC2023-10-0029, §5.1, 2023-12-12]
3. DOE screens bids for legal and technical compliance (via GEA-BEAC)
4. DOE endorses compliant Price Offers to the ERC
5. ERC evaluates the Price Offers against its approved parameters and approves the winners [DC2023-10-0029, §5.4, §6, 2023-12-12]

The Winning Bidder is whoever the ERC approves — not merely the lowest-priced compliant bidder. This gives the ERC substantive gatekeeping authority over GEA-3 outcomes. This is a structural expansion of ERC’s role from price-ceiling setter to active evaluator and approver of GEA outcomes.

2. A new committee — GEA-BEAC — handles legal/technical screening

Under DC2021-11-0036 , the GEAC administered the entire auction from registration through award.

Under DC2023-10-0029, the GEA-Bids Evaluation and Awards Committee (GEA-BEAC) evaluates legal and technical compliance before bids are forwarded to the ERC for price evaluation [DC2023-10-0029, §5.4, 2023-12-12]. The split creates a two-stage gatekeeping process: GEA-BEAC filters on eligibility, ERC decides on price. The GEAC and GEA-BEAC operate in parallel under the GEA-3 framework.

3. Settlement through WESM — not through FIT-All and TransCo REPAs

This is the most consequential structural change.

DC2021-11-0036 (GEA-1/GEA-2): TransCo enters into REPAs with each winning bidder. TransCo includes the GET in its FIT-All petition to the ERC. Costs are socialized across all electricity consumers nationwide via the FIT-All charge. The mechanism is identical to the FiT funding channel.

DC2023-10-0029 (GEA-3): The Non-FIT GET is collected and administered through the WESM by IEMOP . There is no TransCo REPA and no FIT-All. Winning bidders must register as WESM participants [DC2023-10-0029, §7, 2023-12-12].

The payment guarantee works via a top-up / flowback mechanism:

Total GEA Amount = Energy Delivered (kWh) × Non-FIT GET (PhP/kWh)

GESQ (gross energy settlement quantity) is the buyer’s share of electricity purchased in the WESM per Rules §3.13.6 [DC2023-10-0029, §7.1–7.3, 2023-12-12].

The settlement mechanism required ERC approval (deadline: 180 days from IEMOP’s application) and PEM Audit Committee certification before taking effect.

4. RECs go to WESM buyers, not FIT-All payers

DC2021-11-0036 §15: RECs distributed pro rata among RPS Mandated Participants based on FIT-All payments.

DC2023-10-0029 §11: RECs corresponding to Non-FIT winning bidder output are shared pro rata among WESM trading participants via the Settlement Mechanism — i.e., buyers who contributed to the top-up. REC entitlement follows the payment channel [DC2023-10-0029, §11, 2023-12-12].

5. Non-FIT GET Definition: Offered Price → ERC-Approved Price

DC2021-11-0036: The GET is “the price offered by the Winning Bidder” (§5.3) — the bidder’s own offer becomes their tariff directly.

DC2023-10-0029: The Non-FIT GET is “the Price Offer, in PhP/kWh, approved by the ERC” (§4(b)) — the tariff is formally conferred by ERC approval, not merely by winning the auction. The pay-as-bid principle is preserved, but ERC approval is a required step before the price is final.

6. Opt-In Mechanism: Available → Conditioned

DC2021-11-0036 §13: GEAP (including Opt-In) serves as CSP compliance for DUs.

DC2023-10-0029 §10: The Opt-In Mechanism serves as CSP compliance only “upon its full implementation” — the condition is explicit. Full implementation requires ERC approval of the Settlement Mechanism and PEM Audit Committee certification of system compliance [DC2023-10-0029, §10, §15, 2023-12-12].

What Stayed the Same

• Pay-as-bid pricing: Each winning bidder receives their own offered price (Non-FIT GET), not a uniform clearing price [DC2023-10-0029, §4(b), 2023-12-12]
• Preferential dispatch in WESM per DC2022-10-0031
• Auction process structure: NOA → TOR → registration → evaluation → award (per DC2021-11-0036 §9.1)
• No legal impediment requirement for delivery of committed capacity
• Full facility offer rule: Bidder must offer entire capacity of facility (or entire generating unit/s with dedicated metering)
• Opt-In as CSP compliance — but conditioned on “full implementation” of the settlement mechanism [DC2023-10-0029, §10, 2023-12-12]
• Separability, repealing, and effectivity clauses
• Transitory provision: energy delivered before the settlement mechanism is approved settles under WESM PDM/Rules

Eligible Technologies

Non-FIT-Eligible RE Facilities are RPS-eligible facilities (per DC2021-11-0036 §§6.1.1–6.1.2) that are not eligible to FIT [DC2023-10-0029, §4(a), 2023-12-12]:

• Geothermal
• Impounding hydropower
• Pumped-storage hydropower
• Other emerging technologies as declared by the DOE (per DC2021-11-0036 §6.1.4)

GEA-3 Results

Key Process Timeline (GEA-3)

Amendment by DC2024-03-0010

DC2024-03-0010 (25 March 2024) made four changes to this circular, transferring price evaluation authority fully to the ERC:

§5.1 ¶2 amended: ERC must issue its own Price Determination Methodology (PDM) within 60 days of effectivity. PDM to incorporate cost range assumptions and PIRR-weighted cost of capital. DOE no longer publishes parameters [DC2024-03-0010, §1, 2024-03-25].

§5.2 ¶2 deleted: Removed the DOE’s obligation to publish price evaluation parameters — pricing authority now vests exclusively in ERC’s PDM [DC2024-03-0010, §2, 2024-03-25].

§5.4 ¶2 amended: ERC evaluates Price Offers against its own PDM within 60 days of DOE endorsement. The PDM “shall include indexation as may be determined by the Commission” — introducing Non-FIT GET indexation as an ERC-determined PDM component [DC2024-03-0010, §3, 2024-03-25].

§6 amended: Winning Bidder = those “found consistent by the ERC with its PDM” (changed from “approved by the ERC” against DOE-published parameters). Criteria-bound standard replaces open-ended approval [DC2024-03-0010, §4, 2024-03-25].

Amendment by DC2024-09-0028

DC2024-09-0028 (10 September 2024) amended this circular to give Pumped-Storage Hydropower (PSH) a separate settlement mechanism. Key changes:

• §4 definitions amended: Non-FIT GET for PSH expressed in PhP/kW/h (capacity), not PhP/kWh (energy). Price Offer split into c.1 (Geo/Hydro — PhP/kWh) and c.2 (PSH — PhP/kW/h, excluding pumping cost). New definition (e) for PSH Available Capacity.

• §7, 7.2, 7.3 amended: Now apply only to Geothermal and Impounding Hydro. PSH removed from these sections.

• New §8 inserted: PSH settlement — payment based on Available Capacity (not energy delivered); Total Trading Amount includes Energy Market + Reserve Market revenues (TTA = ETA + RTA); collection/flowback split between Energy Market buyers (by GESQ) and System Operator in Reserve Market (by SRQ/TTQ ratio).

• New §9 inserted: PSH market integration rules to be issued by DOE — AS Capability certification, VRE-pumping linkage, single PDS Charge regardless of direction.

• New §10 inserted: Revenue guarantee — GEA Winning Bidder revenues = Total GEA Amount only, based on Available Capacity and Non-FIT GET.

• Old §8–15 renumbered as §11–18.

See Pumped-Storage Hydropower (PSH) in GEAP for the full PSH settlement formula and policy context.

Full text: Cleaned copy